EARNINGS (LOSS) PER COMMON SHARE
Basic earnings (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period.
Diluted earnings (loss) per common share is computed by dividing net income (loss) by the weighted-average number of common shares outstanding during the period, adjusted for the potential dilutive effect of stock options, unvested restricted stock units, and other convertible securities. The calculation includes the effect of dilutive securities only when their inclusion would not be anti-dilutive. For share-based awards, the Company uses the treasury stock method, which assumes proceeds from the assumed exercise or vesting are used to repurchase shares at the average market price during the period.
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| | | | Twelve Months Ended December 31, |
| | | | | | 2025 | | 2024 |
| Net income (loss) | | | | | | $ | 42,326 | | | $ | (18,852,261) | |
| | | | | | | | |
| Weighted average shares outstanding - basic | | | | | | 17,261,755 | | | 17,067,995 | |
| Basic income (loss) per common share | | | | | | $ | 0.00 | | | $ | (1.10) | |
| | | | | | | | |
| Weighted average shares outstanding - basic | | | | | | 17,261,755 | | | 17,067,995 | |
| Plus: | | | | | | | | |
| “In-the-money” stock options | | | | | | 1,439 | | | — | |
| Contingently issuable restricted stock units | | | | | | 1,040,249 | | | — | |
| Less: | | | | | | | | |
| Shares offset for in-the-money options (treasury stock method) | | | | | | (1,234) | | | — | |
| Weighted average shares outstanding - diluted | | | | | | 18,302,209 | | | 17,067,995 | |
| Diluted income (loss) per common share | | | | | | $ | 0.00 | | | $ | (1.10) | |
The Company excluded the following weighted average items from the above computation of diluted loss per common share, as their effect would be anti-dilutive:
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| | | | Twelve Months Ended December 31, |
| | | | | | 2025 | | 2024 |
| Stock options | | | | | | 17,830 | | | 33,339 | |
| Restricted stock units | | | | | | 383,125 | | | 1,515,827 | |
| | | | | | | | |
| Total excluded shares | | | | | | 400,955 | | | 1,549,166 | |
About Earnings Per Share Disclosures
The earnings per share disclosure breaks down the calculation from net income to both basic and diluted EPS, revealing the full impact of a company's capital structure on per-share economics. The reconciliation between basic and diluted share counts exposes how many stock options, RSUs, convertible securities, and warrants are potentially dilutive to existing shareholders.
Key signals: a widening gap between basic and diluted shares indicates growing dilution from equity compensation or convertible instruments. Anti-dilutive securities excluded from the diluted calculation deserve attention — they represent latent dilution that will materialize if the stock price rises. Watch for the effect of share buybacks on per-share metrics: EPS growth driven primarily by repurchases rather than income growth signals weakening fundamentals. Compare year-over-year changes in the diluted share count against equity compensation expense to assess whether management is effectively managing dilution.